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The News is Not All Bad for Slow-Growing Software Spending

Image via Flickr by ruiwen

According to a new report released by International Data Corporation (IDC) entitled “Worldwide Semiannual Software Tracker,” the software industry as a whole grew just 3.6 percent over the past year, or about half the growth the industry experienced during 2010 and 2011. According to authors of the report within IDC, this slowing of growth indicates the beginnings of more conservative spending in the midst of global economic troubles.

However, there is a silver lining to the cloud. Certain subsets of the software industry experienced much higher growth than indicated by the overall market growth. Particularly fast growing sectors include Data Access, Collaborative Applications, Analysis and Delivery, CRM applications, Security Software, and System Network Management Software. Each of these sectors experienced a growth of 6-7 percent, or about double the industry as a whole.

The strongest growth is seen in big data, analytics, and cloud development and deployment. Stiff competition within the industries serviced by software development companies is driving their goals for more big data and analytics. Furthermore, companies converting to the cloud need additional software, such as security software and systems networking management software.

Of the three segments of the software industry measured by IDC – applications, applications development and deployment (AD&D), and systems infrastructure software – AD&D accounted for 24 percent of the total software revenues for the year 2012. This sector also grew the fastest, at 4.6 percent from 2011 to 2012. Business intelligence and relational database management systems (RDBMS) also saw higher than average growth, due to more investments in big data and analytics.

Oracle led the industry in AD&D, holding an impressive market share of 21.6 percent. Microsoft and SAP each gained half a point market share during 2012. Others sharing large portions of the software market include IBM and SAS. Even in the midst of economic instability, certain sectors of the software market show growth and potential.

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